Ebay allows injunctions when it matters, which bolsters innovation and stops patent trolls

This study’s findings have several implications for both participants and policy makers in the patent system. First, district courts have applied eBay in a manner that awards permanent injunctions to operating companies who compete with the infringer in the vast majority of cases, while simultaneously denying them to most PAEs and non-competitors.329 This result holds even after controlling for other potentially confounding factors, such as the field of patented technology and courts where PAEs commonly file infringement claims.330 In particular, the first factor of the eBay test appears to be the main stumbling block for PAEs and other non-competing entities, as they rarely can demonstrate the type of competition-related harm that qualifies as an irreparable injury under existing precedent.331 Denying injunctive relief to PAEs may be normatively desirable in many cases, such as patentees who engage in rent-seeking behavior by exploiting the high transaction costs of patent litigation to extract nuisance-value settlements without any corresponding public benefit.332 eBay’s four-factor test apparently has helped mitigate holdup by such patentees,333 even if PAE litigation remains widespread.334